New opportunities is the world of sports betting are setting a new floor and a new ceiling for theScore (theScore News, Stock Quote, Chart TSXV:SCR).
So says Mackie Research Capital analyst Nikhil Thadani, who this morning raised his price target on the stock from $0.70 to $1.00, implying a return of 138 per cent at the time of publication.
The analyst says recent catalysts have him more bullish than every on SCR, saying what has developed is nothing less than a “massive US sports betting validation”.
theScore stock could hit new highs, the analyst says
“We believe SCR stock could surpass April 2015 highs of ~80¢ in coming months,” Thadani writes. “SCR stock is up ~150% since US Supreme Court Overturned a federal sports betting ban last May, we have been consistently highlighting this development as a major catalyst for SCR stock. Last night, the company announced a major US sports betting related partnership, which effectively establishes a ~60¢/sh level for the stock. We expect the company to launch sports betting in New Jersey in the coming weeks, with Indiana likely next in C2020. Our revised $1.00/sh target, equates to ~$90/user vs. yesterday’s pro forma close at ~$35/user. Industry participants have indicated in New Jersey, the average cost of acquiring an online casino player is >US$500 per new depositing customer. Private US daily fantasy (effectively a sports betting workaround to monetize US sports fan engagement) were valued at ~US$1000/user in C2015.”
Thadani thinks theScore will post EBITDA of negative $4.2-million on revenue of $30.7-million in fiscal 2019. He expects those numbers will improve to EBITDA of positive $1.6-million on a topline of $37.3-million the following year.
The analyst today maintained his “Buy” rating on theScore.
On July 31, Forbes reported that theScore had signed 20-year agreement with North America’s largest regional gaming operator, Penn National Gaming Inc. Forbes contributor Zack Jones called the move “a major step in their quest to expand their US mobile sports betting platform…”.